You probably meant, "That's what it is."
Note that I've used the apostrophe, not the comma.
"That's" is the contracted form of "that is". So the sentence without contractions would be,
That is what it is.
Do you understand it better now? If not, please read the following.
It's difficult to explain meanings of sentences and phrases without any context, Bamdad. Why don't you tell us who said this sentence and what was said before and after that?
Student or Learner